[SYDNEY, NS] — A compromise between Ottawa and the province will allow Nova Scotia’s coal-fired generating plants to operate to the end of their natural lifespans, avoiding an astronomical rate hike for consumers.

New coal-fired electricity regulations, released by the federal government Wednesday, would have meant that six of the province’s eight coal-fired generating plants in Lingan, Point Tupper, Point Aconi and Trenton would have had to close by 2030, at a cost of about $1.3 billion to Nova Scotia ratepayers, the equivalent of about $3,450 per household, according to figures released by the provincial Environment Department.

The draft Canada-Nova Scotia Equivalency Agreement for Coal-Fired Electricity, released Friday, will allow the province to reduce greenhouse gas emissions using its own regulatory approach instead of the new federal regulations.

According to Environment Minister Sterling Belliveau, Nova Scotia’s status as the only jurisdiction in North America that has a hard cap on greenhouse emissions weighed heavily in Ottawa’s decision to come up with a compromise.

Nova Scotia produced just under nine megatonnes of greenhouse gas emissions last year, with provincial regulations calling for emissions to be gradually cut over the rest of the decade until a 7.5-megatonne cap is reached in 2020. Nova Scotia will also be required to cut another three megatonnes between 2020 and 2030, reaching a target of 4.5 megatonnes.

The province aims to meet these targets through increasing its dependence on renewable energy sources, including wind and tidal power, biomass and the Lower Churchill power project.

“The federal regulations would have shut down these coal-fired plants prematurely, and that would have caused extreme hardship to the taxpayers,” said Belliveau. “Our plan is to get ourselves on reliable, renewable energy. But in the short term, coal-fired plants are going to be part of the mix.”

Jason Hollett, executive director of the climate change directorate at Nova Scotia environment, said the equivalency agreement requires no commitment from the province to shut down any of its coal-fired generating plants.

“It would just happen when it makes the most sense to Nova Scotia ratepayers,” he explained. “Nova Scotia Power would continue to operate them until the end of their real economic life.”

As an example, he cited the Point Tupper plant, which was originally constructed in the 1970s to fire oil then retrofitted at great expense in the 1980s to fire coal.

“That was a significant investment, so we want to make sure that it can live out that investment so that ratepayers can get that value.”

Hollett added that while there is also no particular shutdown order for the province’s coal-fired generating plants, circumstances will determine which plants will go offline and when.

“But Nova Scotia Power has announced that Lingan 1 and Lingan 2 will become seasonal units anyway. They are already making those types of plans on what the system will be like when we are using less coal.

“When you put that together with the fact that Muskrat Falls (Lower Churchill) will be falling in Cape Breton somewhere, it might make sense to shut down the Lingan 1 and 2 units, but that hasn’t been determined yet.”